Financing Sanitation: Challenges and Opportunities in Developing Countries
Explore the landscape of sanitation financing and the role of finance intermediaries in addressing the challenges faced by households, enterprises, and utilities in developing countries. Learn about different financing segments, cases studies from Malawi, Rwanda, Bangladesh, and India, and scaling strategies using various financing instruments.
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- Sanitation Financing
- Finance Intermediaries
- Developing Countries
- Household Sanitation
- Enterprise Financing
Presentation Transcript
Valentin Post, FINISH Mondial Thokozani Kaitane, Water For People Malawi, Alok Kumar Majumder, Simavi Bangladesh Santwana Sneha, Finish Society India Barbara Senkwe, Tetra Tech WASH-FIN project, Blended finance for sanitation The role of finance intermediaries
Agenda Conceptual introduction: the landscape for financing sanitation, its different segments Cases: Sanitation financing for improved household sanitation (Malawi, Rwanda) Repayable finance services at household, private service provider (Bangladesh) Pro-poor commercial sanitation financing (India) including video Linking supply and demand of finance for sanitation (Kenya & Senegal) Panel debate interactions with the audience Conclusions and take away messages The role of finance intermediaries: blended finance for sanitation
Demand for sanitation finance (guestimates SDG 6.2) US$ million / year Available finance different segments US$ million / year Sanitation challenge role intermediaries US$ million / year Households 20,000 Microfinance 200,000 Generating / aggregating demand Loan product development Capacity development MFIs Handholding MFIs RBF Policy environment Enterprises 15,000 MSME financing 3,700,000 Technical expertise MSMEs Business development Handholding MSMEs Capacity development financial sector Design guarantees & other financial instruments Enabling environment Utilities 5-15,000 Pension funds 56,000,000 Building business cases meeting R/R profile Project financing (DFIs) Enabling environment Public financing SDG 6 20,000
Scaling : < $10 M US$ 10,000 US$ 100 US$ 1,000 US$ 100,000 US$ 1,000,000 US$ 10,000,000 Financing instruments deployed Development finance guarantees Commercial impact finance development finance Informal sector lending Microfinance RBF Guarantees grants Public investment grants dedicated funds Revolving funds Public investment dedicated funds Climate finance? grants Technical assistance Business skills (capacity dev.) Enabling environment Business skills (handholding) Construction Construction Demand aggregation Business skills Business skills Enabling environment EE (legal etc) Enabling environment Supply side development
Scaling : < $10 M US$ 100 US$ 1,000 US$ 10,000 US$ 100,000 US$ 1,000,000 US$ 10,000,000 Micro finance in its various forms SME financing with guarantees incubation funds (grants/loans); blended finance; competitions commercial impact finance, development finance SME financing with guarantees Project finance (DFIs); blended finance; new funds (TAS,YSB, waterequity, DGGF)
Scaling commercial funding : $10 M < $100M < $ 1B, How? US $ 100 million US $ 1 billion US $ 1 10 million And here? How to get here? Most of us are here
What size of fish are you in currently ($1-10M, $100m, $250M)? Is it working well? How do you become the next fish , what is holding you back? How and by whom does the intermediary get paid? Money often costs too much Ralph Waldo Emerson
Proof of concept of the sanitation impact bond US$ 3 million loan ACTIAM to Cashpor (proof of concept) Finish Society provided TA to Cashpor TA package: demand generation, mason training, monitoring support, handholding Results: (1) loan conversion 100%; (2) Utilisation 97% 36,843 safely managed HH sanitation Testing contracts (RBF), financing routes Independent Evaluation M-CRIL Limited Incorporating EDA Rural Systems Inclusive microeconomics
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